Regulatory concerns about risk layering on interest-only mortgages may be overblown, according to an analysis of subprime IO adjustable-rate mortgages by Friedman, Billings, Ramsey & Co.FBR researchers reported that 10.4% of subprime IO ARMs are underwritten with low documentation and high loan-to-value ratios. And only 5% of subprime IO ARMs have an additional risk layer (debt-to-income ratios of 30% and higher). Loans with four or five risks account for only 1.3% of securitized subprime IO loans. "Therefore, we conclude that the layering of risk occurs among a small proportion of interest-only loans, which represent only 19.5% of all subprime loans," said FBR managing director Michael Youngblood. The researchers did not look at payment-option adjustable-rate mortgages because they represent less than 0.1% of securitized subprime loans. FBR's asset-backed securities research paper also says subprime lenders appear to be allowing borrowers with higher credit scores to obtain interest-only loans and steering those with lower scores into fully amortizing loans. In December, federal banking regulators issued proposed guidance that raised concerns about risk layering on IO and payment-option ARMs. The comment period ended March 29, but the regulators have not signaled when they are likely to issue final guidance.
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The agreement, in which the real estate giant admits no wrongdoing, will cover around 70,000 agents.
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Doxo plans to fight the FTC complaint, which focuses broadly on consumer finance, but there are signs of confusion about the company's role in mortgages too.
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Members of the LGBTQ community were most likely to have experienced housing bias, according to a Zillow survey, which also found many people don't recognize how fair lending laws could help.
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Christopher J. Gallo and his aide, Mehmet A. Elmas, allegedly withheld information in mortgage applications, hiding that borrowers were purchasing second home properties.
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Mortgage rates rose 7 basis points this week, Freddie Mac said, and more increases are likely following a weaker than expected gross domestic product report.
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